VANCOUVER, BC / ACCESSWIRE / July 8, 2022 / Naturally Splendid Enterprises Ltd. ("Naturally Splendid", "NSE" or "the Company") (FRANKFURT:50N)(TSXV:NSP)(OTC PINK:NSPDF) announces its unaudited financial results for the three months ended March 31, 2022. All amounts are in Canadian dollars and are prepared in accordance with International Financial Reporting Standards.
During this reporting period, Covid-19 uncertainty negatively affected sales of existing product lines as well as impaired launches of new product lines. On March 11, 2020, the World Health Organization declared the outbreak of the novel coronavirus ("COVID-19") a global pandemic resulting in governments worldwide, including the Canadian government, enacting extensive measures in an effort to limit the spread of the virus. These measures, which include social distancing, travel restrictions, outright travel bans, and closures of non-essential businesses including restaurants, created a challenging period for the Company.
Naturally Splendid CFO Mr. George Ragogna stated "We are continuing to implement our strategic plan focused on plant-based opportunities. The Company is evolving the manufacturing capabilities and capacities of our existing certified food manufacturing facility as our product mix shifts to more plant-based entrees and appetizers from bars and bites. We have shifted our product mix due in large part to the ten (10) year Canadian exclusive manufacturing and distribution agreement that we executed with Australia's largest plant-based manufacturer, Flexitarian Foods. This agreement is renewable for a further ten (10) years. Naturally Splendid has also secured licensing rights from Flexitarian Foods for the exclusive use of the PlanteinTM trademark in Canada. With the PlanteinTM trademark now secured, we have completed all retail packaging and websites to support this brand. The Company has attended several trade shows recently to promote the launch of the PlanteinTM retail line and national distribution relationships have been formed with Canada's two largest distributors, Sysco Canada and Gordon Food Services (GFS)."
Mr. Ragogna adds, "The Company has completed the design and begun the re-purposing of our existing certified food manufacturing facility in Pitt Meadows, BC. All manufacturing equipment required to produce our plant-based entrees has been ordered with many significant components of the manufacturing line having already arrived at the Pitt Meadows facility. However, there have been delays in receiving some components required to complete the full build-out of the new production lines due to ongoing logistics challenges that much of the manufacturing industry continues to experience. We will continue to receive our plant-based inventories from Flexitarian Foods while the manufacturing lines are still being set up in our own facility. Once the new manufacturing lines in our facility are commissioned, the Company will see an almost immediate return by way of reducing product costs, and improved inventory control, resulting in an anticipated increase in margins. We look forward to providing updates in a timely manner." Naturally Splendid recorded a net loss and comprehensive loss of $747,787 for the three months ended March 31, 2022, compared to a net loss of $767,478 during the three months ended March 31, 2021. Gross profit margins increased by 29% of sales in the three months ended March 31, 2021, compared to the three months ended March 31, 2021, this is due to the increased profit margins in the new plant-based sales. The Company's sales decreased by approximately $160,000 from the comparative period. During the three-month period ended March 31, 2022, selling and distribution expenses decreased by approximately $35,000 largely due to a decrease in production (facility costs, quality assurance and lab testing).
Administrative expenses increased in 2022 compared to 2021 by $22,000. The increase was primarily due to an increase in office, rent and salaries and management and consulting and decreases were primarily due to bank charges and interest. Office rent and salaries reflect the cost of the production, warehouse, office and outside freezer storage premises, and corporate salaries, the increase was due to some employee severances and an increase in freezer storage, otherwise, the office, rent and salaries remained consistent. Management and consulting fees increased due to new consultants for the new plant-based product line.
Naturally Splendid recorded sales of $93,453 during the three months ended March 31, 2022, compared to $144,143 for the three months ended March 31, 2021. The Company's sales decreased by approximately $50,690 from the comparative period. During the three months ended March 31, 2022, the Company's sales decreased by approximately $160,000 from the comparative period. The Company had decreased sales in its private-label bars and bites business by approximately $71,000. Branded hemp products decreased by approximately $2,500 and its Natera Sport products decreased by approximately $101,000. The Company had sales of approximately $50,000 in its new Plant-based products. This is in line with the Company shifting its focus on the new plant-based entrees for contract manufacturing, private label and branded products and will continue to sell to the international Korean markets.
The cost of Sales during the three months ended March 31, 2022, was $54,463 compared to $221,587 in 2021. The Company's gross margin percentage is 41.7% of sales, during the three months ended March 3, 2022.
The Company continues to focus on its higher-margin products and new commercial opportunities for its new plant-based products. The bulk hemp seeds sold at a lower gross margin percentage than compared to plant-based products and private label sales. The Company is now focused. Gross profits for the three months ended March 31, 2022, were $38,990 (42% of sales) compared to $31,791 (13% of sales) for the three months ended March 31, 2021.
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About Naturally Splendid Enterprises Ltd.
Founded in 2010, NSE operates a food manufacturing facility just outside Vancouver, BC in Canada. The Company has established numerous healthy, functional foods under recognized brands such as Natera Sport™, Natera Hemp Foods, CHII, Elevate Me™ and Woods Wild Bar™, and most recently Natera Plant Based Foods, a line of delicious plant-based meat alternatives for the rapidly growing plant-based market segment. The Company has a myriad of new products and line extensions under development that are approaching launch. NSE, through its joint venture Plasm Pharmaceutical, has been approved for conducting a phase 2 clinical trial approved by Health Canada for treatment of COVID-19. NSE has also developed proprietary technologies for the extraction of high-demand, healthy omega 3 and 6 oils from hemp.
NSE contract manufacturers for healthy, functional food products and ingredients focusing on plant-based ingredients. The Company provides contract manufacturing services for many healthy food companies, private labeling a wide variety of nutritional food products destined for global healthy food markets.
For more information e-mail [email protected] or call Investor Relations at 604-5700902 (ext. 101)
On Behalf of the Board of Directors
Mr. J. Craig Goodwin
Naturally Splendid Enterprises Ltd.
(NSP - TSX Venture; NSPDF - OTCQB; 50N - Frankfurt)
#108-19100 Airport Way
Pitt Meadows, BC, V3Y 0E2
Office: (604) 570-0902
Fax: (604) 465-1128
E-mail : [email protected]
Information set forth in this news release contains forward-looking statements that are based on assumptions as of the date of this news release. These statements reflect management's current estimates, beliefs, intentions and expectations. They are not guarantees of future performance. Naturally Splendid cautions that all forward looking statements are inherently uncertain and that actual performance may be affected by a number of material factors, many of which are beyond Naturally Splendid's control including, Naturally Splendid's ability to compete with large food and beverage companies; sales of any potential products developed will be profitable; sales of shelled hemp seed will continue at existing rates or increase; the ability to complete the sales of all bulk hemp seed purchase orders; and the risk that any of the potential applications may not receive all required regulatory or legal approval. Accordingly, actual and future events, conditions and results may differ materially from the estimates, beliefs, intentions and expectations expressed or implied in the forward-looking information. Except as required under applicable securities legislation, Naturally Splendid undertakes no obligation to publicly update or revise forward-looking information.
NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
SOURCE: Naturally Splendid Enterprises Ltd.